Jan. 26 – Houston-based ConocoPhillips and the China National Offshore Oil Corporation (CNOOC) have reached a financial settlement agreement with China’s Ministry of Agriculture to compensate for the damage caused by the June 2011 Bohai Bay oil leaks.

Under the agreement, RMB1 billion (nearly US$160 million) will be paid as compensation to settle public and private claims of potentially affected fishermen in relevant Bohai Bay communities, according to a January 24 press release issued by ConocoPhillips.

“ConocoPhillips will also designate a portion, RMB 100 million (approximately US$16 million), of the company’s previously announced environmental fund to be used to improve fishery resources,” the press release read.

In November, China’s State Oceanic Administration said that the oil spill at the Peng Lai 19-3 field polluted at least 6,200 square kilometers of the Bohai Sea and stated that “ConocoPhillips was deficient in management of the field.”

ConocoPhillips operates and owns 49 percent of the Penglai 19-3 area, while CNOOC owns a 51 percent stake. Production at the field averaged 56,000 barrels per day during 2010, but today remains offline.

In the two accidents in June, ConocoPhillips estimates that 700 barrels of oil and 2,589 barrels of drilling mud leaked through the seafloor near platforms at the field.